East Asia and Pacific Economic Update Outlines Favorable Outlook for the Region
Dili, Oct, 2017 – Growth in Timor-Leste is expected to slow significantly to 2.4 percent in 2017, as public spending moderates amidst presidential and parliamentary elections, according to the latest issue of the World Bank’s East Asia Pacific Economic Update.
The report also notes that Timor-Leste’s growth is likely to recover to 4.2 percent by 2018. Trends in growth for Timor-Leste remain led by the public sector, although there have been some substantial private sector investments over 2016. Exports showed strength in 2016 and the early part of 2017, with coffee exports continuing to increase, by 20 percent in 2016. The growth in tourism is also promising, as international visitor arrivals increased during the first quarter of 2017.
“The well-run national elections this year boosted confidence, but public spending has slowed, with the government in caretaker mode over the election period.” said Macmillan Anyanwu, World Bank Country Representative for Timor-Leste. “Stronger private sector development would benefit from more robust regulatory and institutional frameworks that would improve access to finance, contract enforcement, secure land leasing and bankruptcy legislation.”
The Update, a semi-annual outlook for East Asia and the Pacific, projects economic expansion for the region by 6.4 percent for 2017, supported by stronger growth in advanced economies, a moderate recovery in commodity prices, and a recovery in global trade growth. The report expects Indonesia’s economy to continue to enjoy robust growth at 5 percent in 2016 and 5.1 percent in 2017. Gains in real wages are fueling strong consumption in Indonesia, with unemployment dropping to a record low of 5.3 percent.
“The recovery of the global economy and the expansion of global trade are good news for the East Asia and Pacific region and its continued success in improving living standards,” said Victoria Kwakwa, World Bank Vice President for the East Asia and Pacific Region. “The challenge will be for countries to strike a balance between prioritizing short-term growth and reducing medium-term vulnerabilities, so that the region has a stronger foundation for sustained and inclusive growth.”
Since 2000, the World Bank has assisted the government of Timor-Leste to rebuild national infrastructure, stabilize the economy and strengthen government institutions. In 2017, this work includes support for improved service delivery in education and nutrition, the construction of climate-resilient roads and transport infrastructure, as well as support for the development of non-oil economic opportunities.